[Grant Application] - Ethereum Reserve Dollar (ERD)


Ethereum Reserve Dollar (ERD) aims to address the dominance of centralized stablecoins and offer a truly decentralized, capital-efficient alternative. Our decentralized lending protocol enables users to borrow in a native stablecoin pegged to the US dollar using LSDs and blue-chip DeFi tokens as collateral. It offers a minimum collateralization ratio of 110% and secures loans with a Stability Pool.

This grant proposes to seek additional grant funding to obtain funding for ERD’s V1 contract audit.

**Summary of Grant Applicant:**

Official email: [email protected]

We are an anonymous team of 6 individuals consisting of 5 experienced developers and 1 marketing executive. Our development team possesses extensive professional knowledge that has been accumulated since joining the industry in 2017. ERD will be the fourth successful project that the team has independently built together.

**Project Details:**

ERD is a decentralized lending protocol that enables users to collateralize LSDs and blue-chip DeFi tokens (such as CRV and AAVE) to borrow USDE, a native stablecoin pegged to the USD. The advantages of ERD are outlined, below:

  1. Fully Decentralized: When designing USDE’s clearing and pegging mechanisms, we drew inspiration from those of the Liquity protocol. Our protocol can self-adjust and restore itself to its optimal state without external – or centralized – intervention even in times of extreme volatility in collateral prices.

  2. Diversified Risk: Users can collateralize LSDs and blue-chip DeFi tokens for loans. This spreads the risk of collective defaults and a subsequent USDE depeg across many different areas across the industry, effectively diversifying default risk and market volatility in a way that other stablecoins cannot.

  3. High Capital Efficiency: ERD offers a minimum collateralization ratio of 110% and secures loans with a Stability Pool containing USDE. This allows users to generate more utility from the same amount of on-hand assets than otherwise currently possible.

  4. Protocol Revenue Share: 100% of ERD revenue is split across the community. This includes income generated by loan interest, borrowing fees, and redemption fees. This is a differentiation that will continue to attract users to add protocol liquidity and mint USDE while also generating adequate income through protocol fees to maintain long-term operations.

  5. Community Governance: The community will have decision-making power over significant areas such as protocol expansion strategy, product development decisions, and protocol parameters.

  6. Builder Focus: We currently do not plan to issue a token at this stage and instead intend to focus our attention on project technical development. We aim to transform USDE into a true reserve asset in the Ethereum ecosystem and ERD into a core infrastructure protocol within the LSDfi landscape. Our governance token will be launched after the team is satisfied with the protocol’s stage of development, adoption metrics, and broader market vitals at the right time.

**Post-Grant Plans:**

Grant proceeds will be earmarked for ERD’s third and final V1 contract audit by Code4rena. As of time of application, ERD has successfully passed its first audit by Peckshield and is currently undergoing its second audit by Halborn Security. The combined cost of both audits was $130k, and the team plans to seek an additional $60k for ERD’s audit budget.

**Requested Grant Size:**

60,000 USDC

**Relevant Links:**



Request for Modification of the Grant Application

Our team kindly asks for the grant amount applied to be changed from 60,000 USDC to 20,000 $CRV. We believe that the adjusted amount of 20k $CRV would be more suitable for achieving our objectives.

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The ERD team apply for withdrawal of the Curve grant application. Please delete this topic, thank you.

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